COMMISSIONER, CENTRAL EXCISE COMMISSIONERATE Vs. BANTA SINGH KARTAR SINGH IRON AND STEEL ROLLING MILLS

JUDGEMENT

(1.) The revenue has impugned the order dated 28.9.2005 passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi, vide which, the appeal filed by the respondent-assessee was allowed and it was held that as the respondent is operating one furnace, therefore, its annual capacity shall be taken as 6201.69 MT and not 10594.508 MT as determined by the Commissioner.

(2.) The revenue has raised the following substantial question of law in this appeal:

(3.) The brief facts of this case are that respondent M/s Banta Singh Kartar Singh Iron and Steel Rolling Mills, Mandi Gobindgarh are engaged in the manufacture of Hot Rolled Products of Non-alloy steel falling under Chapter Sub-heating 7214.90 of the First Schedule to the Central Excise Tariff Act, 1985. The unit working under Compounded Levy Scheme was required to file declaration and to make the payment of duty, in terms of the provisions of Rule 96ZP of the Central Excise Rules, 1944. As the respondent was having two rolling mills, but one furnace, so they were required to pay the duty for the rolling mills, which had higher capacity. The Adjudicating Authority determined only the capacity production as 5439.250 MT by taking into account the mill having higher parameters. Thereafter, by applying Rule 5 of the Hot Re-Rrolling Mills Annual Capacity Determination Rules, 1997, the annual capacity of production of the assessee is determined as 10594.508 MT. This determination of annual capacity of the respondent was confirmed by the Commissioner. While determining the higher capacity as 10594.508 MT, the revenue relied on the capacity of the previous year under Rule 5-A of the Rules. The respondent-assessee filed an appeal before the Appellate Tribunal, which was allowed by holding that there is only one furnace, from which, both the rolling mills were being operated and, hence, the respondent is liable to pay the duty as per actual production of the higher capacity of the rolling mills.